More curbs on exports

The Chinese government is planning further measures to reduce steel exports over the next few months. The strategy includes further cut in export rebates given to manufacturers, coupled with voluntary restraints by exporters, senior officials from the China Iron and Steel Association told the official Xinhua news agency.

Over the last two years, the Chinese government had taken several steps such as plans to reduce its steel-making capacity by 35 million tonne in CY07 to curb the industry's growth.

The government had earlier cut steel product export tax rebate from 11 per cent to 8 per cent in mid-September 2006. In addition, they had imposed a further 10 per cent steel billet export tax on November 1, 2006.

The fresh set of measures, which were announced in the first week of March, comes at a time when Chinese steel exports show no signs of easing.

The exports, in the first two months of CY07, amounted to 8.75 million tonne, a whopping 139.3 per cent y-o-y growth, according to the Xinhua news agency and the Chinese General Administration of Customs.

The growth in exports was powered by its steel billet exports, which grew 87.9 per cent y-o-y to 1.12 million tonne in the first two months of 2007, according to figures available.